Ashoura comes as many of the more than one million displaced Lebanese people are trying to return to their villages in southern Lebanon. Cities and towns had held sermons and events in the buildup to the holy day surrounded by buildings reduced to rubble and ruins.

Ashoura, a holy day symbolizing sacrifice and martyrdom, holds special significance for many this year in Iran and Lebanon.

U.S. Ambassador to Lebanon Michel Issa, who is taking part in the Lenanon-Israel talks in Washington, has said that "the Israeli withdrawal will happen sooner or later, but not tomorrow."

The Israeli military said Thursday that a soldier was killed the previous day in southern Lebanon, where clashes with Hezbollah militants have been reported despite a ceasefire.

Master Sergeant Basil Sweid, 32, a driver, "fell during operational activity", the military said.

Lebanon and Israel have agreed to extend the ceasefire after concluding a second day of direct negotiations in Washington, sources told Al-Arabiya on Wednesday.

"An agreement has been reached on creating military 'pilot zones' in south Lebanon," the sources added, referring to south Lebanon areas from which the Israeli army would withdraw ahead of the Lebanese Army's deployment in them.

The Israeli military said it carried out an airstrike targeting suspected Hezbollah militants who crossed into the so-called "security zone" it has created in southern Lebanon, the second such incident it reported within hours on Wednesday.

Israeli Defense Minister Israel Katz said Wednesday that the United States has not demanded that Israel withdraw its troops from southern Lebanon, a condition set by Lebanon in ongoing ceasefire negotiations.

Lebanon has transferred 128 Syrian convicts to their home country, a Lebanese security source told AFP on Wednesday, the second batch of handovers under an agreement the two sides signed earlier this year.

Heavy equipment operator Bassam Khalil's bulldozers and excavators are in high demand in south Lebanon's Tyre these days, as the seaside city tries to pick up the pieces from the latest Israel-Hezbollah war.

An Israeli strike on a vehicle in southern Lebanon killed two people on Wednesday, Lebanese state media reported, a day after Israeli gunfire killed two people which Hezbollah called a "violation" of a truce between the two sides.

Prime Minister Nawaf Salam said Wednesday that Lebanon went to the negotiations in Washington because it was "the least costly path for Lebanon."